IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v18y2025i14p3732-d1701646.html
   My bibliography  Save this article

Forest Biomass Fuels and Energy Price Stability: Policy Implications for U.S. Gasoline and Diesel Markets

Author

Listed:
  • Chukwuemeka Valentine Okolo

    (Forest Engineering, Resources and Management, Oregon State University, Corvallis, OR 97331, USA)

  • Andres Susaeta

    (Forest Engineering, Resources and Management, Oregon State University, Corvallis, OR 97331, USA)

Abstract

U.S. gasoline and diesel prices are often volatile, driven by geopolitical risks and disruptions in the fossil fuel market. Forest biomass fuels, particularly renewable diesel derived from logging residues, offer a low-carbon alternative with the potential to stabilize fuel prices. This study evaluates whether biomass can moderate fuel price volatility using ANOVA, Tukey post hoc tests, and quadratic regression based on monthly data for biomass production, inventories, and retail fuel prices. Findings reveal the existence of a significant nonlinear relationship between forest biomass inventory levels and fossil fuel prices. Average gasoline prices peaked in the medium-inventory group (M = 0.837) and dropped in the high-inventory group (M = 0.684). Diesel prices followed a similar pattern, with the highest values in the medium-inventory group (M = 0.963) and the lowest in the high-inventory group (M = 0.759). One-way ANOVA results were statistically significant for both gasoline (F(2, 99) = 7.39, p = 0.001) and diesel (F(2, 99) = 7.22, p = 0.0012). Tukey tests confirmed that diesel prices fell significantly from both medium to high and low to high-inventory levels. This result remains robust when using the biomass index level and the biomass production level. These results indicate a threshold effect: only at higher biomass inventories do fossil fuel prices decline, suggesting a potential for substitution. However, current policies inadequately support biomass integration, highlighting the need for targeted reforms.

Suggested Citation

  • Chukwuemeka Valentine Okolo & Andres Susaeta, 2025. "Forest Biomass Fuels and Energy Price Stability: Policy Implications for U.S. Gasoline and Diesel Markets," Energies, MDPI, vol. 18(14), pages 1-26, July.
    • Handle: RePEc:gam:jeners:v:18:y:2025:i:14:p:3732-:d:1701646
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/18/14/3732/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/18/14/3732/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Haji Esmaeili, Seyed Ali & Szmerekovsky, Joseph & Sobhani, Ahmad & Dybing, Alan & Peterson, Tim O., 2020. "Sustainable biomass supply chain network design with biomass switching incentives for first-generation bioethanol producers," Energy Policy, Elsevier, vol. 138(C).
    2. Liu, Yang & Huang, Yihan, 2024. "Assessing the interrelationship between fossil fuels resources and the biomass energy market for achieving a sustainable and green economy," Resources Policy, Elsevier, vol. 88(C).
    3. Hernández, Juan J. & Lapuerta, Magín & Monedero, Esperanza & Pazo, Amparo, 2018. "Biomass quality control in power plants: Technical and economical implications," Renewable Energy, Elsevier, vol. 115(C), pages 908-916.
    4. Nico Bauer & David Klein & Florian Humpenöder & Elmar Kriegler & Gunnar Luderer & Alexander Popp & Jessica Strefler, 2020. "Bio-energy and CO2 emission reductions: an integrated land-use and energy sector perspective," Climatic Change, Springer, vol. 163(3), pages 1675-1693, December.
    5. Andrey Vavilov & Georgy Trofimov, 2021. "Natural Resource Pricing and Rents," Contributions to Economics, Springer, number 978-3-030-76753-2.
    6. Altman, Ira & Bergtold, Jason & Sanders, Dwight & Johnson, Tom, 2015. "Willingness to supply biomass for bioenergy production: A random parameter truncated analysis," Energy Economics, Elsevier, vol. 47(C), pages 1-10.
    7. Malladi, Krishna Teja & Sowlati, Taraneh, 2020. "Bi-objective optimization of biomass supply chains considering carbon pricing policies," Applied Energy, Elsevier, vol. 264(C).
    8. Harvey, Mark & Pilgrim, Sarah, 2011. "The new competition for land: Food, energy, and climate change," Food Policy, Elsevier, vol. 36(S1), pages 40-51.
    9. Shivangi Jha & Sonil Nanda & Bishnu Acharya & Ajay K. Dalai, 2022. "A Review of Thermochemical Conversion of Waste Biomass to Biofuels," Energies, MDPI, vol. 15(17), pages 1-23, August.
    10. Considine, Timothy J. & Heo, Eunnyeong, 2000. "Price and inventory dynamics in petroleum product markets," Energy Economics, Elsevier, vol. 22(5), pages 527-548, October.
    11. Harvey, Mark & Pilgrim, Sarah, 2011. "The new competition for land: Food, energy, and climate change," Food Policy, Elsevier, vol. 36(Supplemen), pages 40-51, January.
    12. De Laporte, Aaron V. & Weersink, Alfons J. & McKenney, Daniel W., 2016. "Effects of supply chain structure and biomass prices on bioenergy feedstock supply," Applied Energy, Elsevier, vol. 183(C), pages 1053-1064.
    13. Chau, J. & Sowlati, T. & Sokhansanj, S. & Preto, F. & Melin, S. & Bi, X., 2009. "Economic sensitivity of wood biomass utilization for greenhouse heating application," Applied Energy, Elsevier, vol. 86(5), pages 616-621, May.
    14. Haji Esmaeili, Seyed Ali & Sobhani, Ahmad & Szmerekovsky, Joseph & Dybing, Alan & Pourhashem, Ghasideh, 2020. "First-generation vs. second-generation: A market incentives analysis for bioethanol supply chains with carbon policies," Applied Energy, Elsevier, vol. 277(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Iriarte, Alfredo & Rieradevall, Joan & Gabarrell, Xavier, 2012. "Transition towards a more environmentally sustainable biodiesel in South America: The case of Chile," Applied Energy, Elsevier, vol. 91(1), pages 263-273.
    2. Vik, Jostein, 2020. "The agricultural policy trilemma: On the wicked nature of agricultural policy making," Land Use Policy, Elsevier, vol. 99(C).
    3. Mercure, J.-F. & Paim, M.A. & Bocquillon, P. & Lindner, S. & Salas, P. & Martinelli, P. & Berchin, I.I. & de Andrade Guerra, J.B.S.O & Derani, C. & de Albuquerque Junior, C.L. & Ribeiro, J.M.P. & Knob, 2019. "System complexity and policy integration challenges: The Brazilian Energy- Water-Food Nexus," Renewable and Sustainable Energy Reviews, Elsevier, vol. 105(C), pages 230-243.
    4. Ozgul Calicioglu & Alessandro Flammini & Stefania Bracco & Lorenzo Bellù & Ralph Sims, 2019. "The Future Challenges of Food and Agriculture: An Integrated Analysis of Trends and Solutions," Sustainability, MDPI, vol. 11(1), pages 1-21, January.
    5. Ciliberti, Carlo & Jordaan, Sarah M. & Smith, Stephen V. & Spatari, Sabrina, 2016. "A life cycle perspective on land use and project economics of electricity from wind and anaerobic digestion," Energy Policy, Elsevier, vol. 89(C), pages 52-63.
    6. Cao, Yan & Doustgani, Amir & Salehi, Abozar & Nemati, Mohammad & Ghasemi, Amir & Koohshekan, Omid, 2020. "The economic evaluation of establishing a plant for producing biodiesel from edible oil wastes in oil-rich countries: Case study Iran," Energy, Elsevier, vol. 213(C).
    7. Emmann, Carsten H. & Schaper, Christian & Theuvsen, Ludwig, 2012. "Der Markt für Bioenergie 2012," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 61(Supplemen), pages 1-20, February.
    8. Emmann, Carsten H. & Schaper, Christian & Theuvsen, Ludwig, 2011. "Der Markt für Bioenergie 2012," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 61.
    9. Thaler, S. & Zessner, M. & Weigl, M. & Rechberger, H. & Schilling, K. & Kroiss, H., 2015. "Possible implications of dietary changes on nutrient fluxes, environment and land use in Austria," Agricultural Systems, Elsevier, vol. 136(C), pages 14-29.
    10. Tiffany L. Fess & James B. Kotcon & Vagner A. Benedito, 2011. "Crop Breeding for Low Input Agriculture: A Sustainable Response to Feed a Growing World Population," Sustainability, MDPI, vol. 3(10), pages 1-31, October.
    11. de Jong, Sierk & Hoefnagels, Ric & Wetterlund, Elisabeth & Pettersson, Karin & Faaij, André & Junginger, Martin, 2017. "Cost optimization of biofuel production – The impact of scale, integration, transport and supply chain configurations," Applied Energy, Elsevier, vol. 195(C), pages 1055-1070.
    12. Bose, Arnab & Ramji, Aditya & Singh, Jarnail & Dholakia, Dhairya, 2012. "A case study for sustainable development action using financial gradients," Energy Policy, Elsevier, vol. 47(S1), pages 79-86.
    13. Xiao Lyu & Yanan Wang & Yuntai Zhao & Shandong Niu, 2022. "Spatio‐temporal pattern and mechanism of coordinated development of “population–land–industry–money” in rural areas of three provinces in Northeast China," Growth and Change, Wiley Blackwell, vol. 53(3), pages 1333-1361, September.
    14. Till Hermanns & Katharina Helming & Katharina Schmidt & Hannes Jochen König & Heiko Faust, 2015. "Stakeholder Strategies for Sustainability Impact Assessment of Land Use Scenarios: Analytical Framework and Identifying Land Use Claims," Land, MDPI, vol. 4(3), pages 1-29, September.
    15. Lisa Biber-Freudenberger & Amit Kumar Basukala & Martin Bruckner & Jan Börner, 2018. "Sustainability Performance of National Bio-Economies," Sustainability, MDPI, vol. 10(8), pages 1-20, August.
    16. Luís Carmo-Calado & Manuel Jesús Hermoso-Orzáez & Roberta Mota-Panizio & Bruno Guilherme-Garcia & Paulo Brito, 2020. "Co-Combustion of Waste Tires and Plastic-Rubber Wastes with Biomass Technical and Environmental Analysis," Sustainability, MDPI, vol. 12(3), pages 1-19, February.
    17. Ruci Wang & Ahmed Derdouri & Yuji Murayama, 2018. "Spatiotemporal Simulation of Future Land Use/Cover Change Scenarios in the Tokyo Metropolitan Area," Sustainability, MDPI, vol. 10(6), pages 1-18, June.
    18. Carlo Carraro & Marinella Davide & Valeria Barbi & Giacomo Marangoni, 2013. "Science adva ncements, policy immobility: the two fac es of climate (in)action," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2013(3), pages 5-29.
    19. Qi-Qi CHEN & Jun-Biao ZHANG & Yu HUO, 2016. "A study on research hot-spots and frontiers of agricultural science and technology innovation - visualization analysis based on the Citespace III," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 62(9), pages 429-445.
    20. Hermanns, Till & Helming, Katharina & König, Hannes J. & Schmidt, Katharina & Li, Qirui & Faust, Heiko, 2017. "Sustainability impact assessment of peatland-use scenarios: Confronting land use supply with demand," Ecosystem Services, Elsevier, vol. 26(PB), pages 365-376.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:18:y:2025:i:14:p:3732-:d:1701646. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.